Thursday, September 1, 2011

Can Motion Control Get Consumers Interested in TV Again?

In 2005, video game maker Nintendo (PINK: NTDOY ) revealed the controller to
its Wii game machine, a wand-like device with just a few simple buttons on it.
The real hooks of the controller were that it could sense peoples movements, and
also work essentially as a mouse for a television screen, letting users point
and click. It was simple and meant to be held vertically, designed to be
inviting and familiar to audiences used to holding a simple remote after decades
of watching television. Six years later, televisions are mimicking the Wii
living room audiences will be pointing at their televisions to pick options and
gesturing to navigate menus from here on out. Hillcrest Labs, a developer of
motion-control technologies, announced a whole new line of products on Wednesday
that herald how televisions will change in the coming years. The Scoop Pointer
remote control is itself not unlike a Wii controller an in-air mouse that lets
you point at options on television or a PC and connects through a USB dongle.
The controller, of course, also would be coupled with the Freespace MotionEngine
and Fresspace Sensor Modules, the technology that set-top box manufacturers that
work closely with cable companies will incorporate into their devices to provide
motion control. For example, Motorola (NYSE: MMI ) could license the Freespace
technology for its cable set-top, boxes meaning Time Warner (NYSE: TWX ) and
Comcast (NASDAQ: CMCSA ) could then offer motion-controlled video games as part
of a cable service package. Rokus digital video set-top box, which offers
streaming services like Netflix (NASDAQ: NFLX ), already use Hillcrests
motion-control technology for both its TV interface and games like Rovios Angry
Birds . Internet television hasnt gone mainstream just yet, but that stands to
change in the next 12 months . Logitech (NASDAQ: LOGI ), another Hillcrest
partner, and Google (NASDAQ: GOOG ) tried and failed in 2010 to bring television
that uses a web browser style of accessing content to the masses. How people
interact with that sort of interface, using a more intuitive and natural feeling
device, will go a long way toward easing the adoption of Internet television.
Whats standing in the way right now? For one, television sales are in the
gutter. According to Nielsen, just 66% of U.S. homes have bothered to upgrade to
an HD TV . Television manufacturers like Sony (NYSE: SNE ) and Panasonic (NYSE:
PC ), meanwhile, are pushing hard to sell not just HD TVs but 3D TVs, which
consumers are disinterested in. If new motion-control technology from Hillcrest
(which already works with Sonys video game division) or another company adds an
extra cost to actual television sets, it will be as ignored as any other new
feature. If motion control is just an added bonus, consumers should respond. The
other difficulty is the conflict between cable providers and web-based streaming
alternatives like Netflix. Cable companies, streaming television companies and
television content providers are in the midst of a nasty power battle. Cable
companies are losing subscribers 32% of cable subscribers that responded to a
Diffusion Group Survey said they plan to cut down cable service because of
services like Netflix. Companies like Time Warner, in turn, are rushing to offer
their own streaming options beyond the living room but, as a result, content
providers like Viacom (NYSE: VIA ) are miffed about their wares being spread
over disparate services (though Viacom is adapting fast ). Until this conflict
smooths out and it becomes clear what customers are watching what television on
what platform, new technologies like motion-control interfaces are going to take
a back seat to control of content. But for investors curious about the future of
living room entertainment, Hillcrests new toys offer more than a sneak peak. As
of this writing, Anthony John Agnello did not own a position in any of the
stocks named here. Follow him on Twitter at

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